Trade Agreements ‘costly’ for Malawi

Malawi Market Place - Mzuzu (File Photo) Malawi Market Place - Mzuzu (File Photo)

Dr. Moses Tekere, Director of Trade and Development Studies Centres in Zimbabwe says Malawi could lose eight billion Kwacha (approximately 11 million US Dollars) of its total revenue, after ratifying the Tripartite Free Trade Area TFA and the Africa Continental Free Trade Area ACFTA agreements.

Dr. Tekere said this in Malawi, Blantyre on Monday on the sidelines of a validation workshop on studies conducted on Malawi’s bilateral and regional trade pacts.

“The government of Malawi has to take into account certain challenges because they will be removing tariffs on imports coming from Africa, and the major conclusion in the study is the loss on revenue collection of up to 11m US Dollars,” said Dr. Tekere adding that industry would also be negatively affected.

However, Dr. Tekere observes that there are also indicators of some positive outcome from the trade liberalization process which Malawi could benefit from.

“Malawi needs …strategic trade liberalization which takes into account sensitivities of the industries. Especially those that need protection before the ratification,” he added.

Principal Secretary in the Malawi ministry of Trade, Ken Ndala, said Malawi is yet to come up with a position on the outcomes of the studies as it would appear that some local companies are looking forward to Malawi entering the agreements.

“We will be expecting the private sector and all of us, as key stakeholders, to make a decision as to which products to keep and those that we don’t want to liberalize, as well as which countries to sign a trade agreement with,” Ndala said.

Malawi is one of the countries that has signed but not ratified the Tripartite Free Trade Area and the Africa Continental Free Trade Area.

In the past, the Malawi government has been blamed for entering agreements without in-depth understanding of implications and costs of such agreements.

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Last modified on Tuesday, 19/11/2019

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